It’s been two years since Ryan Coffey filed the first lawsuit against Ripple, claiming XRP was an unregistered security.
The Coffey lawsuit was voluntarily dismissed but other lawsuits emerged and are still active. Zakinov v. Ripple Labs Inc has been active since November 2018 (with Bradley Sostack as the lead plaintiff) while two other lawsuits were recently filed: Simmons v. Ripple Labs Inc. in March 2020 and Bitcoin Manipulation Abatement LLC v. Ripple Labs Inc. in May 2020. While the Simmons case was filed in New York, the other two were filed in California.
Joint Consolidation Motion
With the Bitcoin Manipulation Abatement LLC lawsuit and the Zakinov case involving and concerning nearly-identical parties, transactions, and events, Ripple and Lead Plaintiff Bradley Sostack filed a joint motion to relate the cases on May 11.Consolidation-Motion
Ripple and Bradley Sostack argued that proceeding the two cases before different Judges would be inefficient, unduly burdensome, and duplicative. Relating the cases would serve the interests of justice and further judicial economy.
The BMA attorney Pavel Pogodin was contacted to agree on the consolidation of the two cases but was hesitant to stipulate.
“It will be judge’s decision if the cases are related enough to warrant consolidation. Again, without seeing a single case where it was done, I’m unwilling to stipulate.”
Mr. Pogodin and BMA even declared no interest in a class action settlement.
“In view of the fact that your other case is a class action and this case is not, and further in view of the fact that my client intends to opt out of any class action settlement, I see limited procedural advantages in consolidating the two cases for pre-trial proceedings.”
Joint motion granted
On May 28, the court ruled that the two cases would get related and consolidated into one, thus granting the joint motion by Ripple and Sostack. According to the court, BMA did not file an official response to the motion.
The judge reached this decision because:
- Both actions concerned substantially the same parties
- Both actions concerned substantially the same property and events and
- Relating these actions would avoid duplicative litigation and inconsistent results
The judge even noted that:
“Based on errant typos in its complaint, it appears that plaintiff BMA literally copied, pasted (without formatting), and then deleted numerous footnotes some of the CFAC’s allegations.”
Unlike what some media outlets may have reported, this is most surely not a defeat for Ripple. Ripple managed to avoid having to defend two identical cases, with the BMA case involving an entity with little to no online presence and questionable motives.